The Coventry-based company said the sale to BK Engineering's management was in line with a strategy to streamline its UK operations.

Norman Hay had previously announced its intention to concentrate on its core businesses of specialist chemicals and surface coatings.

In the eight months to August 31 BK Engineering made a loss on ordinary activities before taxation of £122,000. Net asset value was £533,000 on August 31.

Norman Hay still owns the Leighton Buzzard site leased to BK Engineering, but said it would look to sell this in due course.

Last month the group announced that pretax figures grew to £899,000 against £334,000 a year ago.

Sales for the six months to June 30 were £10.9 million, up from £10.1 million last year.

Chief executive Victor Bellanti said there was unlikely to be further streamlining of the business in the immediate future. "I would say there is not much more for us to do. We moved Plasticraft from Cannock to Coventry last year and, with the sale of BK Engineering, I don't see further streamlining occurring at this time."